I was thinking about purchasing a house Or multifamily Salinas/Castroville? A new hospital Kaiser is being built in the area, along with a train/transit in the next several years. Also, a horse race track is proposed, along with a deSal plant in Moss Landing. The 2 marine labs are expanding as well. So many things are happening in this area & I was wondering if it would be a good place to invest? However, the area is very strict on water supply and the farms in the area are of heavy pesticide usage, (strawberries and artichokes) which seems strange in such a ecofriendly state as California. The area is changing, but Im not sure if good for an investment yet.? Thanks kindly! Gayle
Hi Gayle, the Peninsula is pretty overpriced for rentals IMHO. It all depends on what you want to do. Properties are appreciating at a pretty good rate with DOM usually around 30 days or less. If you put very little money down, I am not sure if you will come ahead with purchase price vs rental income.
I haven't heard about a new hospital being built here, other than the VA clinic in Marina. Same thing with a train hub. The desal and racetrack might be dead in the water depending on who you talk to. There is always a lot of talk, just not sure when it will come along.
Let me know if you need any help. I am a RE agent in Carmel.
What are your thoughts on Moss Landing? future there? thank you!
Not sure about Moss Landing. I have no experience there. If you see something specific I can dig into for you.
I would consider place north like Watsonville. Kaiser is having a new office in downtown after 1st of the year. Personally I prefer even north. The area you mention do not have a lot of steady jobs. If you expect occasional no or regular tardy rent go for it. At one point downtown Watsonville stores were all closed a few years ago, leaving McD as the only restaurant open. Unemployment in Santa Cruz Co. was 15%+ now it is above 1/2 around 8. If you want sect 8 tenants then it is a different story. Salinas is also attractive when they were 50% lower than now. In Santa Clara County duplex is around 900K in any neighborhood.
During the last RE downturn I noticed values inland in Santa Cruz-Monterey Co fell in value quite a bit further than the higher priced coastal areas on a percentage basis. That being said..I really like the Moss Landing/Prunedale area and think its a pretty good value overall..although I DID sell my property on Elkhorn Slough during that time. Also..the race track is dead..and the proposed de-sal idea is uncertain..so I wouldnt invest based on that.
I wouldn't base any investment off of appreciation due to potential buildings in the area. If you find something that cash flows well and will survive a downturn in that area then that is great, but basing it off of a desal plant or horse racing track that might or might not happen doesn't sound like a good idea. Also, the harshness on Farms is something to watch closely because it is one of the main industries in the area. Loss of farms = Loss of tenants.
If it cash-flows at below market value and at conservative vacancy rates then go for it. Then maybe you get lucky and they build it the area.
for what it is worth, the horse track development is officially dead. never coming back.
the dev refused to indemnify the city against potential lawsuits resulting from, well, everything...shoddy EIR, greenie groups, etc.etc.
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